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Muni-Bond Group Bans Dual Adviser-Underwriter Roles

A key municipal-bond trade organization on Tuesday prohibited institutions from serving as both financial adviser and underwriter on new bond issues in a bid to resolve conflict-of-interest concerns.

The change prohibits municipal securities dealers from acting as a financial adviser to a municipal entity on a new bond issue and subsequently acting as an underwriter on the same issue. The change will take effect Nov. 27.